Reserve Bank has not misled, everyone has just misread
If the RBA is browbeaten into not acting decisively to give us the best chance of the narrow path through this, they genuinely risk getting behind the game.
The apparent shift in perceptions about the economy and interest rates this past week was more about a misguided economic narrative that had taken hold in Australia over the past six months, as it was a radical shift in RBA thinking.
The RBA has changed nothing this week except a small upward revision to growth and inflation in early 2023. This largely reflects a stronger starting point for both inflation and labour demand than previously expected.
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Warren Hogan is managing director of EQ Economics.
